74 replies to this topic

[stocks]

French President Francois Hollande, the Socialist who was sworn in last month, has pledged to cut the retirement age to 60 from 62

French President Francois Hollande: "Make Layoffs So Expensive For Companies That It's Not Worth It"

The Welfare State End-game -- How will it all end?

I expect European voters to vote for their entitlements. That is what the French just did. They voted for "growth" in government rather than austerity. Voters vote their pocketbooks, right up until the day that the government closes the banks and devalues the currency.

France Goes Full Socialist

Although Greece’s elections were much in the news on Sunday because of their severely imminent debt crisis, Greece has a relatively tiny economy — whereas France is running the euro’s second-largest economy.

Hollande now has free rein to do whatever he wants. I believe he will do just that, and if so the bond markets will not take too kindly to it, nor will Merkel, and nor will the average citizen in Germany, Finland, the Netherlands, or Austria.

An amazing amount of attention has been focused on the election in Greece when a far more important election was just held in France. The French election received scant media coverage.
Moreover, Spain has not been fully reckoned with, nor has Italy.

France Has At Most Three Months -- If Hollande carries out his stated programs, it won't take three months before the bond market revolts, Germany revolts, or both revolt.


http://advisorperspe...on-Sideshow.php

[Rogerdodger]

One more reason not to visit MA.:
CAMBRIDGE, MA CONSIDERS SODA BAN IN RESTAURANTS

Policy Order Resolution

O-4
IN CITY COUNCIL
June 18, 2012
MAYOR DAVIS

WHEREAS: High intake of soda and other sugar-sweetened beverages increases the risk of obesity and diabetes; and
WHEREAS:
New York City has a plan to limit the serving size of soda and other sugar-sweetened beverages sold in restaurants; now therefore be it
ORDERED:
That the City Manager be and hereby is requested to refer the matter of a ban on soda and sugar-sweetened beverages in restaurants to the Cambridge Public Health Department for a recommendation.


WHEREAS: Pie is OK. Fried chicken and gravy too.
WHEREAS: You people are too stupid to make your own choice.

Edited by Rogerdodger, 18 June 2012 - 11:52 PM.

[stocks]

The General Motors situation is a microcosm of what's gone wrong in our country.

The bankruptcy process resolved none of GM's core problems. The process was subverted by the political establishment, which sought to protect one class of citizen at the expense of the regional economy, GM's bondholders, and its customers.
The bailout of GM wasn't a bailout of the company. It wasn't a bailout of its shareholders Where did the money go? To the union. The United Auto Workers (UAW) ended up with all the money.

GM slid into bankruptcy primarily because it couldn't profitably manufacture cars. And the biggest single reason it couldn't profitably make cars was because its labor costs had soared.
Well, guess what? At $56 per hour, GM still has the highest labor costs in the industry.

The bankruptcy process didn't deal with the biggest financial hurdle GM faces, which is an enormous (and growing) unfunded pension liability.

The purpose of bankruptcy is to free productive assets from the burden of debts that can't be repaid or refinanced. We do this because it's good for society, not because it's good for creditors. Had the bankruptcy been handled legitimately, GM's assets would have ended up in the hands of better entrepreneurs. Its workers could have found new, productive jobs at a rate the market would bear.

But that's not what happened. Instead, the government injected an amazing $50 billion into the company and, at last count, has lost roughly half of it.


http://www.dailyweal...st-Bankruptcies

[stocks]

The biggest scam going in American financial life may be the collusive effort by Wall Street, the political class, and public sector unions to use union retirement money to prop up Wall Street speculation.

Step One: state politicians promise big pension and health care benefits to their unionized work forces, but don’t set aside enough money to fund those benefits when the bill comes due. This makes union leaders and unions look good, because they can point to the shiny new benefits they have negotiated with the politicians. Meanwhile, it makes the politicians happy because the unions support them with contributions and volunteers at election time, but because the unions don’t insist on full funding for the benefits, the politicians don’t have to raise costs or otherwise disturb the big majority of voters who don’t work for the government.

Step Two: Make aggressive assumptions about the rate of return on pension investment funds. This has two consequences: it covers the gap between promise and reality (for a while), thereby postponing the day when the politicians have to face the voters and the union leaders have to tell their members that those beautiful benefits were bogus from the start. But the other purpose, equally important, is that it forces America’s public sector pension funds into the deep end of the financial markets, leading pension funds to be major investors in hedge funds, derivatives and various other not-for-the-widows-and-orphans investments.

Fees for the $242 billion in California’s giant state pension system, known as Calpers, nearly doubled, to more than $1 billion a year, after it increased its holdings in private assets and hedge funds to 26 percent of its total in 2010, from 16 percent in 2006…

Calpers…has earned 3.4 percent annually over the last five years.

In Illinois, the pension system for teachers is about as well funded as a Bernie Madoff fund: 18.8 percent of what it needs.

the whole mess is a strong argument for those who believe that “regulatory capture” means that a powerful government ends up serving the rich and well-connected rather than helping working and middle class Americans


http://blogs.the-ame...-pension-funds/

[stocks]

42 Straight Months of Stupidly Optimistic Official Predictions About Economic Recovery

Once-a-month quotes from the administration and the media about how the economy will be booming any minute now.

Washington economic experts have been proclaiming that economic recovery is right around the corner since before they were sure the patient was sick.

For those of us who have been saying all along that none of the economic interventions since 2007 would revive the economy—not the rescue of Bear Stearns and other financial institutions; not the Troubled Asset Relief Program; not the American Recovery and Reinvestment Act; not Quantitative Easings I, II, and III; not the Patient Protection and Affordable Care Act; not Cash for Clunkers or Solyndra or the bailouts of Chrysler and General Motors—the cavalcade of wrongheaded, fantastical economic analysis coming out of official Washington and its media in recent years would be hilarious if it were not so infuriating.


http://reason.com/ar...pid-predictions

[stocks]

We're in a bigger hole than 1979-82

So now we have to go through the horrors of 1979-82 all over again. Only this time it is hurting a lot more than back in the early days of the Reagan revolution.
That is because we are in a bigger hole this time.

The truth is that the ruling class has created a monster. The more that it taxes and spends the less that people feel responsible for getting out and making a difference, and the more people demand "free stuff" like everyone else.

The real blunder is the whole idea that major social functions should be performed by government. It is just not true that there is a need for a compulsory program of national retirement savings. Most people are pretty prudent; once they get their kids raised they start to save for retirement.

That goes for health care and education, too. Women are passionately engaged in health care for their family, and drive family spending to budget for health care. Ditto education. If the government weren't delivering health care and education then people would do it on their own, like the middle class did before the invention of the welfare state.

Of course, all these social functions would be different if government didn't do them. They would involve a lot more personal involvement. People would volunteer at hospitals and schools and give money to them; they would help their relatives with hospital bills and school fees; they would belong to fraternal organizations that provided social benefits to their members. That is what middle-class people used to do.

But the ruling elite decided that they wanted to run all these social functions.


http://roadtothemidd...of-sixties.html

[stocks]

The biggest scam going in American financial life may be the collusive effort by Wall Street, the political class, and public sector unions to use union retirement money to prop up Wall Street speculation.

NYC Police Pension Tension

Last year, New York City taxpayers put nearly $2.1 billion into the cops’ $24.7 billion pension fund to pay for future benefits — up from more than four-fold from the 1999-2000 average

One problem is that the pension fund isn’t earning the magical returns expected of it. It’s supposed to generate 8 percent returns a year — but has managed just 5.76 percent annually over a decade.
The desperation to achieve higher returns is on display in how much the fund (run by a board that includes the mayor, the police commissioner, the city comptroller and union officials) pays out in investment fees.
These fees now top $90.4 million — 405 percent of the $22.3 million in fees for 2000, even as the fund’s value has risen only 34 percent.

More than 200 high-priced investment “consultants” are slurping at the trough, up from 38 a decade ago. The recent roster includes a firm called Quadrangle, which got in trouble a few years back for political payoffs at the state pension fund.
But not even Bernie Madoff on crack could generate enough returns to pay what we’ve promised.


Here’s a truly scary stat: New York is inching toward paying more retired cops than active ones

That’s because we let cops retire so young (as soon as after 20 years of service) with a half-salary benefit, including overtime.
The NYPD has more than 12,096 retirees who are younger than 55, making an average of nearly $43,000 in pension benefits.
Twelve years ago, the city had 3,526 retirees under 55, who made a benefit of less than $30,000.


http://www.nypost.co...Opb45LkkKEQQLiN

[stocks]

Detroit Model Cities Program

Destruction of Detroit

In 1961, the last Republican mayor of Detroit lost his re-election bid to a young, intelligent Democrat, with the overwhelming support of newly organized black voters. His name was Jerome Cavanagh. The incumbent was widely considered to be corrupt (and later served 10 years in prison for tax evasion).

He greatly expanded the role of the government in Detroit, taking advantage of President Lyndon Johnson's "Model Cities Program" – the first great experiment in centralized urban planning.

Mayor Cavanagh was the only elected official to serve on Johnson's task force. And Detroit received widespread acclaim for its leadership in the program, which attempted to turn a nine-square-mile section of the city (with 134,000 inhabitants) into a "model city." More than $400 million was spent trying to turn inner cities into shining new monuments to government planning. In short, the feds and Democratic city mayors were soon telling people where to live, what to build, and what businesses to open or close. In return, the people received cash, training, education, and health care.

What happened? Even with all their power and money, centralized planners couldn't succeed with any of their plans. Nearly all of the upper and middle classes left Detroit. The poor fled, too. The Model City area lost 63% of its population and 45% of its housing units from the inception of the program through 1990.

Even today, the crisis continues. At a recent auction of nearly 9,000 seized homes and lots, less than one-fifth of the available properties sold, even with bidding starting at $500. You literally can't give away most of the "Model City" areas today. The properties put up for sale last week represented an area the size of New York's Central Park. Total vacant land in Detroit now occupies an area the size of Boston. Detroit properties in foreclosure have more than tripled since 2007.


http://investorvilla...mp;mid=11937667

[stocks]

Hiroshima vs Detroit

What has caused more long term destruction – the A-bomb, or U. S. Government welfare programs created to buy the votes of those who want someone to take care of them?

For 15 years, from the mid 1970′s to 1990, I worked in Detroit, Michigan .

I watched it descend into the abyss of crime, debauchery, gun play, drugs, school truancy, car-jacking, gangs, and human depravity. I watched entire city blocks burned out. I watched graffiti explode on buildings, cars, trucks, buses, and school yards. Trash everywhere! Detroiters walked through it, tossed more into it, and ignored it. Tens of thousands, and then hundreds of thousands today exist on federal welfare, free housing, and food stamps!

With Aid to Dependent Children, minority women birthed eight to 10, and in one case, one woman birthed 24 children as reported by the Detroit Free Press, all on American taxpayer dollars.

A new child meant a new car payment, new TV, and whatever mom wanted. I saw Lyndon Baines Johnson’s ‘Great Society’ flourish in Detroit . If you give money for doing nothing, you will get more hands out taking money for doing nothing.


http://truebluenz.co...ima-comparison/

[stocks]

Why The Screwed Generation Is Turning To Paul Ryan

Boomers don’t want to give up their sweet deal, but the rest of us have reason to embrace Ryan’s “radical” plans

We’ve finally been vindicated: Members of Generation X have a representative who is anything but a slacker.


http://www.thedailyb...-paul-ryan.html